Octopus Devours Chula Vista

San Diego  Last summer's revelations about ex- port commissioner David Malcolm's conflicted relationship with Duke Energy should be instructive. It's no secret that developers have been in Chula Vista for a while; South Bay developers seem willing to build whether there we have adequate support services, have reached the threshold point of traffic, have enough water, or have enough schools to accommodate the influx of students. Developers are so eager to keep developing they are willing to build a private toll road, SR 125, which will enable them to expand further eastward.

How ideal: Residents in Chula Vista can live in McMillin Lomas Verdes, and children can attend Corky McMillin Elementary School. Corky McMillin has a public record that, like the tip of an iceberg, exemplifies the way developers are entwined with elected officials.

It was telling when Shirley Horton Grasser (currently Mayor Horton), appointed to fill a vacancy on the Chula Vista City Council in 1991, abstained from her first item of business. According to the Union-Tribune, "Grasser Horton, owner of Grasser Tate Real Estate Co.,...had to abstain from...a public hearing on a Rancho Del Rey development. [She] has stock in a company associated with the development, creating a potential conflict of interest." Corky McMillin was the developer of Rancho Del Rey, a 1584-acre residential and commercial project on East H Street. Moreover, when Horton first came to the city council, her husband worked for a law firm that represented EastLake, another major Chula Vista developer. On Horton's 1994 mayoral campaign-disclosure statements, you don't find contributions from Ma and Pa Chula Vista. It may be understandable why political allies David and Annie Malcolm each contributed the maximum, but what did the people from Bakersfield, Newport Beach, Salinas, Santa Barbara, Irvine, Half Moon Bay, and Laguna want from a future mayor?

Another example of this overlap happened in 1995, when Mayor Horton wanted to appoint John Moot to a vacancy on the city council. (Moot made campaign contributions to Horton's mayoral campaign.) The problem with appointing Moot? His law firm -- Sullivan, Cummins, Wertz, McDade & Wallace -- did legal work for McMillin Development, Inc. The Chula Vista city attorney at that time, Bruce Boogard, warned that a potential conflict of interest "could exist if Moot indirectly benefits as a shareholder in his law firm from McMillin's Chula Vista projects." Would Corky McMillin want to see Moot appointed if he had to recuse himself on issues pertaining to McMillin developments? According to the Union-Tribune, Horton met with McMillin on Horton's way to City Hall "to dispel talk that McMillin was trying to block Moot's possible appointment." The same article quotes McMillin as saying, "There was concern on our part about having a four-person council when we have a good 50 percent of our livelihood depending on what happens in Chula Vista. We weren't in favor of anybody getting appointed to anything if they couldn't vote on any of our stuff."

The Corky McMillin Company sends out a publication (advertisement) called McMillin Lomas Verdes. In the spring 2000 issue, Mayor Horton contributed a letter. "Transportation Enhancements Coming in 2002." No doubt Horton's letter was prompted by the mounting complaints about traffic aired in many public venues by Chula Vista residents. The letter/article was designed to dispel worries and entice prospective buyers. If the buyers were still not forthcoming, in June of this year, Chula Vista held an "informational fair" for potential homebuyers. Aside from realtors and mortgage lenders, representatives from master-planned communities were there to sell their wares. It was no surprise that the Union-Tribune article announcing the fair assured us that "Liz Barela, an assistant marketing director at the Corky McMillin Companies, said her firm will be promoting its newer communities."

In May of this year, an article in the Chula Vista Star-News, "CV candidates are not bought by developer money," quoted city attorney John Kaheny as saying, "Generally speaking, political contributions to a candidate do not constitute a conflict of interest unless you have a specific provision, much like we have, for exceeding $1000 in any four-year period." The article continued, "It's when an individual or principals from a company give a candidate more than $1000 in four years that a council member is required to recuse himself or herself from voting on projects associated with the contributor." Two hundred fifty dollars is also the maximum an individual can contribute.

When I phoned Chula Vista city attorney John Kaheny last July and asked him how long the $1000 limitation had been in effect, he told me since 1989. I verified with him that the word "principal" refers to CEOs, presidents, vice presidents, and managers of a company. When asked who is responsible for checking on possible violations, he said the answer was "complicated." The way the code was written, he explained, did not allow the city attorney to investigate violations because the city attorney is appointed by the council.

By the end of our conversation, it was unclear whose job it was to monitor the contributions. I told him I was inquiring about the limitations because Councilmember Patricia Davis seemed to be in violation of this ruling both in her 1998 campaign and in her recent 2001 campaign for reelection: principals of McMillin had contributed in excess of $1000. I said that I was not aware of a time when Davis had recused herself in regard to a McMillin project. Kaheny agreed that he could not remember such a time. (When later asked by phone if she had ever in her term on city council recused herself from voting on a McMillin project, Davis said, "I cannot recall, but I remember recusing myself on McMillin projects when I was working on the planning commission.")

Davis, who became a city council member in 1998, worked for McMillin Realty for several years before starting her own real estate business in 1995. Her opponent, Dr. Al Salganick, was worrisome to developers; he favored controlled growth and opposed the construction of SR 125. Salganick picked up 32 percent of the votes in the primary; Davis received only 27 percent. Though nearly every developer in town contributed heavily to Davis's campaign, when it looked as if Salganick might win, the McMillin Company outdid itself. For the November runoff, contributions ran as follows: